Chapter 13 bankruptcy is an effective debt relief solution for people who want to keep some of their secured assets, like their homes, while eliminating their unsecured debt. Also referred to as reorganization bankruptcy, Chapter 13 bankruptcy will generally require people to develop detailed plans for repaying their creditors (rather than liquidating assets to repay creditors, as in Chapter 7 bankruptcy).
People who may be best served filing for Chapter 13 bankruptcy can include those who:
- Earn too much money to qualify for Chapter 7 bankruptcy (i.e., did not pass the “means test” for income reasons)
- Want to retain their secured assets through the bankruptcy process
- Have a substantial portion of debt that is non-dischargeable in Chapter 7 bankruptcy (such debt can include, for instance, certain types of tax debt, child support debt, etc.)
- Have filed for bankruptcy in the recent past and need to seek this type of debt relief again.
There can be a number of other situations in which filing for Chapter 13 bankruptcy will be in an individual’s (or a business’) best interests, so don’t hesitate to contact the experienced Denver bankruptcy attorneys at Garcia & Gonzales, P.C. for professional, honest advice about your best options.
As previously noted, Chapter 13 bankruptcy will require people to devise very detailed plans regarding how they intend to repay their various creditors over the next three to five years. While these plans (known as repayment plans) can outline how certain debt will be repaid in full (like mortgage debt when people want to keep their homes after bankruptcy), they can also provide for the partial repayment of unsecured debt (like credit card debt, etc.), depending on the judgment in a given case.
Here are a few more important things to know about repayment plans in Chapter 13 bankruptcy cases:
- Repayment plans must be devised and delivered in “good faith,” meaning that the debtor has every intention of following through with the plan.
- With repayment plans, creditors must be able to obtain at least as much repayment as they would under a Chapter 7 case.
- Creditors can contest people’s proposed repayment plans, and it will ultimately be up to the Bankruptcy Court to approve these plans in Chapter 13 bankruptcy cases.
With Chapter 13 bankruptcy, there may be a number of different benefits people can realize. In particular, some of these benefits generally include:
- Getting immediate relief from creditors and their attempts to take punitive actions (like repossessions, foreclosure, wage garnishments, etc.)
- Being able to keep as much of their assets as possible while eliminating various debt
- Having more time to pay down (or pay off) non-dischargeable debts
- Improving one’s financial standing once Chapter 13 bankruptcy cases are finally concluded.
Are you ready to find out if Chapter 13 bankruptcy is right for your or your business? If so, it’s time to contact the experienced Denver bankruptcy attorneys at Garcia & Gonzales, P.C. With more than 50 years of combined legal experience, our trusted lawyers have the legal knowledge, skills and insight you can count on to help you successfully resolve your debt issues.
To learn more about Chapter 13 bankruptcy and how we can help you, contact us today by calling (303) 839-8888 or by emailing us using the drop-down contact form at the top of this page.
When you contact us, you will communicate directly with one of our attorneys, not a paralegal or legal assistant. We welcome Spanish-speaking individuals to contact us also – hablamos Español.